Evidence of meeting #3 for Fisheries and Oceans in the 39th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was companies.
NDP
Peter Stoffer NDP Sackville—Eastern Shore, NS
Finally, if DFO has their way and institutes these new reforms, did they indicate to you a particular date when this is going to happen? Was there a window of opportunity for, say, the committee or you to still raise objections to this?
President, Biorex Inc.
The history of this episode is this. This reform was announced in the federal budget in February 2005, and our DFO clients called all the observer companies the day after and informed us that this reform was announced the day before. We were asked to attend a meeting in Montreal in April 2005. All the at-sea observer companies and the DFO were there, and the main topic of this meeting was the announced reform. We voiced our objections then to this reform, but basically what DFO told us at that time is, it's done and we're asking you to give us your views on the fine details on how to apply this new reform. We answered them, no, we won't give you our views on how you should implement this reform; what we're telling you is we're against this reform.
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
Thank you, Mr. Chair. I'll be sharing my time with Mr. Manning, so don't let me go beyond five minutes.
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
Thank you.
Thank you, Mr. Gagnon, for appearing.
I appreciate the detailed brief. It will help us to be able to relay your concerns to the minister.
If I understand correctly, the area in question is divided up into four regions and each of those regions has one exclusive contract, and you hold two of those: Quebec and the Gulf.
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
What was the process you went through to get those exclusive contracts?
President, Biorex Inc.
Basically, every three years the DFO goes into a contract award process, an open bidding process, which is announced maybe eight months prior to the closing date in the public electronic contract award system. During the time between the announcement and the date that the proposals are sent to the government, there may be some questions or meetings to answer bidders' questions.
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
How competitive was that? Were there multiple bidders on these contracts?
President, Biorex Inc.
No. I must admit that from year to year the number of bidders in each individual region is not very high. We're talking maybe between three and five bidders in some regions in some years, maybe fewer
To comment on this fact, I would say that the observer business is a very difficult one, mainly because we're offering a service to the fishers for which we are not welcome, necessarily. I can imagine that many organizations--well-established organizations, serious companies that might like to have the contract--look at the request for proposals, which is very systematic and demanding, and look at the prices, and say maybe they won't try.
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
Good. I understand that.
Let me just clarify one thing about the way the system works currently. If I'm a fisherman registered in Quebec, let's say, but I fish both in Quebec and in the gulf, or let's say I fish in another region that's not held by your company, what do I have to do when I go fishing outside the region in which I'm registered?
President, Biorex Inc.
Right now, the exclusivity of the services is based on the fishing licence, which means that if the fisherman you are talking about uses a Quebec licence to fish, he will be covered by our company, and if he uses a Newfoundland license to fish, even in Quebec, he should be covered by Newfoundland observers.
Fortunately, that doesn't happen often.
Conservative
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
So the fisherman faces considerable expense. Is it his expense, then, to bring this observer from the area in which he is registered, if he's licensed?
President, Biorex Inc.
It depends. I'm not aware of those details. I'm not the one in charge of the operational aspects of the observer program.
I would say that if a fisherman changed from one region to the other on an individual trip, I don't think we would ask him to change the observer from one region to the other. We're talking about....
When this happens, we're covering, for instance, northern shrimp vessels, which go to sea for more than 40 days each trip, or fleets, for instance--fleets from Quebec that fish in the Atlantic, where there is a large group of vessels.
Conservative
Randy Kamp Conservative Pitt Meadows—Maple Ridge—Mission, BC
It's because I understood it to be one of the complaints raised by the fishermen about the current system, complaints that were to be addressed by the proposed new system.
Anyway, thank you very much. I'll turn it over to Mr. Manning.
Conservative
Fabian Manning Conservative Avalon, NL
Thank you, Mr. Chair.
I thank Mr. Gagnon for his presentation.
I've dealt with Seawatch Inc. in Newfoundland, who have provided this service to Newfoundland and Labrador since 1981. I'm very concerned about the integrity of the program, with the plans that are being put forward by government, for the simple reason that, as they would say in my neck of the woods, it may be a possible case of hiring the fox to watch out for the chickens. That's not the way we need to conserve our industry.
At the same time, the concern this raises is the cost of providing the service and the cost that goes back to the pockets of the fishermen. My question is, how does your company, or how do the companies involved here, reduce that cost to fishermen?
Right now in my area the continuous increase in fees associated with participating in the fishing industry is a big issue. If this program is revamped to go forward under the present plan of government, as I understand it, the fees will be passed over to the people in the industry once again. That's the concern I have, and I'd like you to address it.
Also, I would like you to address the question of the competition factor—you somewhat answered this with my colleague—among the companies involved in providing the service today. I'd like to know if you could give some indication of what the observer program was costing, say, five years ago compared with what it costs today. Even though I don't support the change to the program—I want to lay that out front, that I don't—I am concerned about the estimated cost of providing the program, from your company's perspective.
I'd like you to address those couple of issues, if you could, please.
President, Biorex Inc.
Thank you. I'll address the easy question first and then the hard one.
As to how the cost has changed over time, I can only talk for the Quebec and gulf regions. I don't have the details for the other regions, although I have some idea.
In both Quebec and the gulf I can tell you—and DFO and Public Works have all the details on this—that the costs of the observer program between 1995 and now have diminished by 10%, if you take into consideration the consumer price index. There are many reasons this decrease happened, and one of them is that the bidding process was competitive. That's for sure. I don't know many services can demonstrate a 10% decrease in 10 years.
I can tell you also that the prices in the Quebec and gulf regions are very competitive when you compare them with all the other observer programs in the world, except those in Africa. If you compare our Canadian observer program total price per sea day with those for American, European, Australian, or New Zealand programs, our price is very competitive. It's the lowest you will find in the world.
As for the other aspect, which is how to share the price of the program between the government and the industry, my feeling is that it is not my business to determine this or to comment on it. That is between the government and the industry to decide.
All I want to say here today is that the present system is not perfect, but it's based on fundamental principles that ensure the best price. With the proposed reform, those fundamental principles will be thrown overboard, and anything can happen with the price.
Conservative
The Chair Conservative Gerald Keddy
Thank you, Mr. Gagnon.
Thank you, Mr. Manning. You're actually over your time.
Mr. Cuzner.
Liberal
Rodger Cuzner Liberal Cape Breton—Canso, NS
He can have some of my time, because a number of my questions have already been answered.
Perhaps you could just give me an overview of the industry. Who are the biggest players in the industry? Would your company be one of the bigger players in the industry?
President, Biorex Inc.
Are you talking about the observer industry or the fishing industry?
President, Biorex Inc.
Currently there are four observer companies that provide service to DFO in Canada. There is one in the Pacific, one in Newfoundland, one in the Maritimes, and our company.
These four companies have been bidding against one another over the last fifteen years. A number of other companies have been bidding, without success, through the years. These are very serious, competent companies.